A searchable audio archive from the 2013-2016 legislative sessions of the North Carolina General Assembly.

searching for

Reliance on Information Posted The information presented on or through the website is made available solely for general information purposes. We do not warrant the accuracy, completeness or usefulness of this information. Any reliance you place on such information is strictly at your own risk. We disclaim all liability and responsibility arising from any reliance placed on such materials by you or any other visitor to the Website, or by anyone who may be informed of any of its contents. Please see our Terms of Use for more information.

House | May 1, 2013 | Chamber | Commerce

Good morning, welcome to the Commerce and Job Development Committee.
It's my pleasure to have everyone here today. We do have some pages with
us today. We have Caitlin ?? from Wake County, sponsor of our
representative Stan. We have Caitlin ?? from Harnett County, sponsor of
our representative ??. We have Kiara Rhodes from Wake County, sponsored
by ??. And we have Carrington Royles from Harnett County, sponsored by
David Lewis. First bill on the calendar, the agenda for today, is House
joint resolution 55, Reform Workforce Development. This bill does not
have a proposed committee substitute so representative Howard, you are
recognized to explain the resolution.
[SPEAKER CHANGES] Thank you, Mr. Chairman and members of the committee.
This resolution actually came out of the program evaluation division,
tied to a study that was completed May 9th of 12. A lot of folks think
that this bill does more than what it does but actually it is only a
vehicle to get a message out to you, the members of the general
assembly, of what that program evaluation study produced. There is no
legislation that is currently tied to this resolution so all the
Workforce Development folks that have been concerned, there is no
further action after this is heard on the floor. I will point out that
the program evaluation division learned that the Workforce Development
system is funded with $1.4 billion and over half of that funding comes
from the general assembly. The division report found that State level
leadership and local structures compromised effectiveness and there were
no State-wide performance measures to provide any accountability with
regard to Workforce Development. The in session law 2012 131 implemented
all of the PED recommendations and the commission of Workforce
Development is following through as intended on all of those
recommendations. Basically the joint resolution expresses the general
assembly's opinion that the Governor and local elected officials should
reduce the 23 existing Workforce Boards to 16 and conform the boundaries
to the existing boundaries of the Council of government's regions as PED
recommended. With that, Mr. Chairman and members of the committee, I'll
be glad to answer any questions. Again it is a message to the members of
the general assembly to learn what the findings of Workforce
Development, what the PED is determining that would improve Workforce
Development.
[SPEAKER CHANGES] Representative Lucas, you are recognized.
[SPEAKER CHANGES] Thank you, Mr. Chair. Haven't had the pleasure of
working on PED with Rep. Howard. She's explained this very exhaustively
and done a very thorough job and so at the appropriate time I'd like to
offer a motion.
[SPEAKER CHANGES] Further discussion, further debate by members of the
committee? Rep. Lucas, this is the appropriate time.
[SPEAKER CHANGES] Move for favorable report.
[SPEAKER CHANGES] Motion being properly made, all those in favor
say,"Aye." All those opposed, say, "No." The ayes
have it. Rep. Howard, congratulations.
[SPEAKER CHANGES] Thank you.
[SPEAKER CHANGES] We are going to displace House Bill 112 at the request
of the primary sponsor until a future date so we will move on to House
Bill 473 which is the NC Captive Insurance act. Rep. Dockham has let me
know that, I believe, you have some technical amendments. I will let you
explain the bill and then let staff explain the technical amendments and
move forward on that.
[SPEAKER CHANGES] Thank you.
[SPEAKER CHANGES] You are recognized.
[SPEAKER CHANGES] Thank you, Mr. Chairman and members of the committee.
Some of you have all . . .

We heard this bill, captive insurance act, and the House Insurance
Committee, so I’m going to be very brief. But just briefly, captive
insurance companies, or insurance companies that are solely to insure
the risk of a specific company or group. The captive insurance group is
a wholly subsidiary of a parent company or an industry association.
Captive insurance companies are not a new concept but it is a new
concept for North Carolina. We have businesses using captive insurance
in North Carolina now, but those captive insurance companies are not
located here in North Carolina. What House Bill 473 would do is allow
captive insurance companies to be domiciled here in North Carolina,
making it easier for North Carolina companies to obtain this type of
coverage and allowing North Carolina to charge and keep the premium tax
these companies pay. So it is a win-win situation, Mr. Chairman and
members of the committee. And Mr. Chairman, I have from the insurance
department Rose Von Williams here to explain the bill a little more
technically. But we do have a technical amendment, if the Chairman would
allow that to be heard now, I would appreciate it. [SPEAKER CHANGES] Do
all members have a copy of the amendment? I believe it’s being passed
out. Representative Daughtry, you’re recognized to discuss the
amendment. [SPEAKER CHANGES] Thank you Mr. Chairman. Members of the
committee, this is purely a technical amendment. It was just changes
that the Secretary of State asked us to make, to make the language more
clear and she assures me that it is purely technical. And staff would be
glad to answer any questions, Mr. Chairman. Thank you. [SPEAKER CHANGES]
Representative Brawley, you’re recognized. [SPEAKER CHANGES] I move that
the amendment be adopted. [SPEAKER CHANGES] Further discussion, further
debate on the amendment. Hearing none, all in favor will say aye. All
those opposed say no. The ayes have it. We’re back on the bill. Further
discussion, further debate on the bill as amended? Hearing,
Representative Atley, you’re recognized. [SPEAKER CHANGES] I just have a
kind of a question of why have they not been allowed in the past? Was
there any particular reason that they had been not allowed to do
business or is this something that’s come up in terms of types of
insurance? Exactly history, a little bit here. [SPEAKER CHANGES] Well,
Representative Avila, this is a very specific type of insurance. I don’t
think that it’s not, it wasn’t that they weren’t allowed to be here, no
one just took the initiative to bring this forward so that they could be
domiciled here in North Carolina, and this would allow them to do that.
Companies are doing this in North Carolina now, but they’re having to go
out of state to buy the coverage. This will allow companies to be
located here in North Carolina. [SPEAKER CHANGES] Further discussion,
further debate on the bill as amended. Hearing none, all those in favor
will say aye. All those opposed say no. Ayes have it. Thank you
Representative Daughtry for bringing this jobs bill before the Jobs and
Commerce Committee. [SPEAKER CHANGES] Thank you Mr. Chairman. I believe
this has a referral to Finance, if I’m [SPEAKER CHANGES] That was part
of the motion that I heard. [SPEAKER CHANGES] that’s what I thought so.
Thank you Mr. Chairman, thank you members of the committee. [SPEAKER
CHANGES] We are going to skip over the game nights non-profit fund
raiser because we’ve got some speakers that want to speak in favor of
the bill and pose the bill. I will recognize at this point
Representative Martin, are you ready to present House Bill 629? It’s my
understanding that there is a PCS for this legislation. Representative
Tolson moves that the PCS be properly before us. [PAUSE] Representative
Martin, you are recognized. [SPEAKER CHANGES] Thank you Mr. Chair.
Members of the committee, I sent out an email yesterday that included a
lot more detail on this bill, because I find it to be a lot more helpful
to understand the purpose of why this is coming forward as legislation.
So I hope you had a chance to look at that. I did not provide a hard
copy. But a little bit of background, this is in fact a very simple
bill. It’s a technical change to special purpose projects and there are
a number of special purpose projects that qualify for tax free or tax
free bonds from the local government commission. So these need to be
approved at the state level when there’s new business investments that
qualify. And there’s a lot of federal requirements about that and I have
some staff out here if you’re interested in learning more about the bond
structure, which I did go through a lot of questioning about

Looks like this is necessary and how can this really that makes sense
says solid waste recycling plants and projects to qualify for in this
type of bond financing delegates were two ways to crash IE get either
culture in five C salad waste recycling facilities also qualify because
every selling KM as the Somali faction planes and M E's B recycling that
this is what I think it would qualify for these acts of financing ninth
and communities that want to offer that same year industry electronic
business that DC is designed to help of an I5 UEL information about
that, you anticipate that when the company said is getting ready to
enter the planting grass in my district is not considering two sentences
in grades nine E street, North Carolina defensive E C's FIC police
products and recycles an increase in the product is exported to
increment uses for these airports and a rail systems and creamy
alliance,(SPEAKER CHANGES) a man of the next four ID and rarely sank in
an intensive CD set up entry on the headliner from this and acting
secretary of commerce in support of the stamp designs from C trucks are
commission agriculture and water from the department of finance the
chain of custody are in support of a spellbinding not have any
opposition to that enabled EL major industry from L.a. to questions can
be had from Texaco testing techniques and residuals and you recognize,
which challenger area from ocean and the procession from a legislation
and number two person tells you recognize from ocean storm, fulfilling
reported most of the safety of five motivational deal is a referral to
one recession for the bail motion of arts and culture.(SPEAKER CHANGES)
And also say of all schools in the house and Gerson Margarita brings her
job to build for the job to commerce moment basically warehouse building
72% in C right to work are some of you recognize the flavor of conflict
is chairman of the committee of hostility 72 is rather straight 4-1 in
this room knows we are right to work study of chapter 10 of our station
oracle to check and 95 of six league tells us that the right of persons
to work in our state cannot be denied or abridged whether they are
member of the union or not a member of the union was a 72 goals as it is
you cannot fourth from one to be a member of the union by a contractor
to engage them in so we're looking contract law to get two parties one
party cannot require the other 42 employee members of the union at war
for the contract the ballot if that language is written to contract out
that the other contract itself will be for him on a forceful wish to
respond in our discussion for the debate on the bill Arsenault which the
film recognize this song is still from the resource kit, sorry over by
the national relations are national labor relations act , (SPEAKER
CHANGES) despite concerns that work for passing legislation that's
already covered by Federal law which would preempt this and we do best
lists of movement for safari, but Federal authorities to share the bomb
that was the question for the bill sponsored are some of you recognize
that the jurors in the public's deferred a question to staff the
generally recommend against each year on perfect opportunity? Sharon
stone quest is the question was known as we did the story covered by the
national labor relations act and it's something we would be about 4¢
because his ability to render the faulty friend of a Federal law , and I
am not completely sure the best recently, there is a simple question
with regard to instruction contracts that are similar to the delays in
all of the past because no one can ??.................

There's a clear question in that situation with regard to whether those
kinds of contract or the restrictions in those kinds of contracts would
be preempted by federal law. There's a split among other jurisdictions
in case law on that question, and it has not been dealt with by the Ford
circuit yet. So there is some question to whether or not that might be
preempted by federal law. This bill is broader, and it is not, from my
research, and I'm not a labor lawyer so I don't hold myself out as an
expert on this, it's unclear with regard to other types of contracts
whether or not the federal law applies to this.
[SPEAKER CHANGES]
Representative Jeter, you're recognized.
[SPEAKER CHANGES]
I was just going to make a motion when appropriate.
[SPEAKER CHANGES]
OK. Representative Terry?
[SPEAKER CHANGES]
Thank you, Mister Chair, I'd like to ask a question about the bill
sponsor, please regarding, or perhaps as a staff question, I'm not real
clear. I would like to know how or what impact of the federal Davis
Bacon law would have with regard to this legislation.
[SPEAKER CHANGES]
Thank you, Representative Terry, Mister Chair would like to refer that
question to the staff.
[SPEAKER CHANGES]
I'm afraid I cannot answer that at this point. I'd be happy to research,
and get back to you.
[SPEAKER CHANGES]
Representative Evelyn, Representative Alexander.
[SPEAKER CHANGES]
Thank you, Mister Chairman, I'd like to inquire with the bill sponsor,
what the genesis of this bill is. Have you received a lot of complaints
about this particular practice?
[SPEAKER CHANGES]
Well, thank you Representative Alexander, quite honestly, the genesis
was Representative Stam.
[SPEAKER CHANGES]
Follow up: has he received a lot of complaints?
[SPEAKER CHANGES]
I believe he has, which is the reason he brought this legislation
forward. Further discussion, further debate? Are you done,
Representative Jeter? Representative Fisher, you're recognized.
[SPEAKER CHANGES]
Thank you, Mister Chairman, I wonder if there is anybody from labor who
is in the audience who might like to address this at all?
[SPEAKER CHANGES]
Feel free to introduce yourself to the committee. We recognize for your
time not to exceed two minutes.
[SPEAKER CHANGES]
Thank you, Mister Chair, my name is Mike Oak, and I'm here for the North
Carolina state AFLCIO. It's our view, that representative Hall
suggested, that this law is preempted by federal law. Under the National
Labor Relations Act, no employee can be discriminated against on hire,
because they are or are not a member of the union. In fact, no one must
join the union at any time in any state. In the non-right-to-work
states, what an employee must do, they don't have to be part of a union,
but they have to pay their share of the dues that go to administering
the contract that they enjoy. They're entitled to a rebate for any part
of the dues that go to political work, or lobbying, or anything like
that. The union has to represent them, but they have to pay their fair
share. In North Carolina under our law, you don't even have to pay your
fair share. You enjoy the benefits under the contract, but you don't
have to pay any part of it. The National Labors Relations Act is
supposed to be a uniform law for the whole country, and a state cannot
regulate what the NLRA regulates. And as the supreme court has said, any
conduct that is arguably covered by the National Labors Relations Act is
preempted. One narrow exception is what's called 14B, which was put in
in 1947, which says that a state can prohibit if it wants, an agreement
between an employer and a union that everyone must pay their part of the
dues. It says that everyone has to join the union, but the way that's
been interpreted, you don't have to join the union, you just have to pay
your part of the dues. So congress said we're going to make an
exception: each state can decide for itself whether or not it wants
employers and unions to be able to agree to that. And we decided that we
didn't want that to be allowed in the contract, and that's what our
right to law does. but anything beyond that is preempted. And this is
not a case between an employer and a union, and this is not a case of an
employer signing a contract, this is a case of one employer telling
another
Under the national

Order to discriminate in hiring is one employer to another lawyer only
hire union people. And yes I said, your time is expired yet Thursday's
wrap up is an and that the labor act specifically prohibits that. Now,
and so our view is forth the Larson from smoking is expansive, I noticed
a vexing and complicated area, but I just want to have argue thank you,
Mister
[SPEAKER CHANGES]
but for your presentation rivers are probably recognize him. This drug
can would you accept in question, sir chairs you start from the priority
list.
[SPEAKER CHANGES]
Mister Okun under this video, someone would not be able to require
another company. The union in order to bid for business is that covered
under the National Labor Relations Board act that you refer to. Yes,
all your international organization came to a city as part of their
contract demanded that only union labor be used to predict the reprints,
documents, would that be a violation of the law, the National Labor
Relations Board.
[SPEAKER CHANGES]
I think if the if the first, if some organ in the organization and is
straight out of the state said that in North Carolina. Another employer
and can only hire union people outside of the cockpit that would violate
labor. Yes
[SPEAKER CHANGES]
I want follow-up because that that's not the question I asked how well
can you require that bids that bidders must be union in order to be up
for work in North Carolina in a contract, it is.
[SPEAKER CHANGES]
It's a complicated situation with contractors in North Carolina I have
actually in the construction industry contract with the hall to refer
workers to work near at hand and are too kind hall. One is an exclusive
hall where the employer since I'll only get members from the hourly
workers union hall in a situation union also has to refer any nonunion
members who come and want to be referred
[SPEAKER CHANGES]
Mister Chairman, the gentleman 's not even address in the class was not
as cheesy as I said, we can't believe that this is a confusing and
vexing area. I wish the answers were simple but I don't guess I don't
think that under the labor act, you can require that only union workers
be hired to work on your property.
[SPEAKER CHANGES]
Mister Oken. I guess the example coast represented Alexander and I
debated this on before the general assembly of the Democratic national
convention came to North Carolina entered into a contract, you ran the
convention center control at North Carolina and as a condition of that
contract required that all printed materials for all visitors. Package
must be printed by only union light. There was only one print shop in
North Carolina and Charlotte. That was a union printshop and twenty
seven others were for bid and the even been on the work.
[SPEAKER CHANGES]
The question I'm asking you is it your testimony today that the
Democratic National Committee or convention violated the national Labor
Relations act by demanding that only union shops, print material to be
handed out at the Democratic national convention. I don't think it
violates the labor that I don't know the facts the case. I don't think
it violates the Libra for an employer to say I want to go through union
contract. However that does not mean that all of the labor union
contract for our members and the union are paying dues. For example, I
feel like I might say as if I might say I want you to hire. I want you
hire ex- company because they have a union as I want to hire them as
fine, but but it doesn't mean that those employees have to join the
Union restroom is right and it just means I have to work for union shop
without any union member by businessman who is not a union shop should
be forbidden from bidding contracts, according to your testimony well,
and Sarai believe that violates the idea of a right to worksite, Mister
Chairman, I'm in favor of this bill done. I will take back control or
euro quicker the Valley air. I recognized Jim? Isabella Rosen 's
speciality. I agree that this is a confusing enticing and I believe
that this

Will we support it,
[SPEAKER CHANGES]
Roosevelt then he recognized this
[SPEAKER CHANGES]
chairman of two things that I would like for division owned 's" and
secondly I would just like to observe there if I following the this
dialogue correctly, it seems that it's possible that you could right
now, the existing law. I draw a contract that saved with the revs of
the wrongs talk about it is possible that their contract would be
unenforceable, and if it's unenforceable and he would be like a number
of symbolic of things that people enter into any industry, I would be
very akin to the symbolic article six section four of the state
Constitution. It requires literacy test before you can register to
vote, which I have been assured that is rendered unenforceable. At this
point. All you recognize her second start of the members or call two
minutes ago one we ask only that you work twice and not sure this is
printed by federal law. I think of the body. We need to be careful not
to continue to pass unenforceable laws that reason, I would urge the
members not still further discussion. Further, they were liberal in the
terminal building address if I'm understood the discussions. The
consensus seems today from the especially ability of that, it is not
discriminatory to require the contract. The union that it is
discriminatory to require that they, not the union of my sense at all to
me and I think we need to build a clarify exactly how we feel in North
Carolina and as far as symbolic. It represent Alexander 's comments
about it being symbolic if somebody says you've got to do. You got to
have union contracts. It may be symbolic than what you follow lawsuit
against the muscle is going to handle, and we did make it clear,
allowing we don't agree with this artificial access says that he was
chairman I would really like to have seen her center from labor again
address that question that and said it I'm sorry, as in a row. I also
probably just just brought up as if that's possible. * time not to
exceed one minute registered German again, many Prelude by saying it's a
complicated area and but my understanding is not unlawful for an
employer to say I want to use a nonunion contract, it would be unlawful
for the nonunion contractor to then refuse to hire somebody because
their union, but so they can say I will usually use non- union
contractor and selling in union contractor, that's fine with the right
to work law says it is that you neither site have a contract that says
neither those contracts have apprentices. Everybody was showing the
union what is already against the law to discriminate when the
contractor hires based on whether somebody is or isn't a member, but
again I thank you for your patience. I know its competent area and and
and and people will disagree to thank you present efficiency.
[SPEAKER CHANGES]
Thank you, Mister Chairman, I visit many just sounds like to me that the
him fully clear on attempt at making up new law and know that no fun
served himself said that Tatum, he's here on behalf of another member
and you know I just I I feel uncomfortable as saying yes to passage of
this without more clarification on without know a clear clear knowledge
that we are not presenting federal law and they are just too many
questions. As far as I'm concerned, and I am I will will a process and
I have you all join me in that president probably recognize her second
year, you might should use our initials were first mind. You got to
grow is an here I'm sorry, I know how is referring to the chairman. I
am
[SPEAKER CHANGES]
Mister Chairman, I didn't really know

Talking about today, but it’s an interesting thing to raise. I did vote
for a resolution that asked the DNC to use a lot of local companies to
support the convention. The Charlotte Observer reported very proudly
that 31% of the contracts were let to North Carolina Companies. That
means 69% were not. And part of the reason for that is, there was a
preference for a union contractor. And it was stated in their purchasing
regulations. Non-union contractors could bid, and except for printing
they did not have to become a union shop to get work. But it was stated
that preference would be given to union contractors and most of the
business went out of state. I’m not really clear on what Mr. Okin ?? has
said today other than to assume that if his statements are completely
true he’s saying that the Democratic National Convention violated
Federal law by not, by refusing to deal with non-union companies. And
going out of state. I don’t really think that’s the law. I think what
we’re seeing is an attempt to confuse the situation and try to create
fear, uncertainty and doubt, to use an old phrase from the computer
industry, to scare people away from something that you don’t want them
to do, so they’ll buy your certain product instead. And that’s all it
is. This is a clear thing. If you write a contract that says you’re only
going to use, or only allow your contractors to use, union shops that
contract will not be valid in North Carolina, because we’re a right to
work state. And you can’t enforce it. You can’t force cities not to hire
non-union. You can’t force other people. Doesn’t mean they have to not
hire union. It means you don’t get to tell them what to do. That’s all.
Mr. Chairman, I’m in favor of this bill.
[SPEAKER CHANGES]
Representative Floyd, you’re recognized.
[SPEAKER CHANGES]
Mr. Chairman, I’d ask the bill sponsor a question, please.
[SPEAKER CHANGES]
You’re recognized.
[SPEAKER CHANGES]
How time-sensitive is this bill?
[SPEAKER CHANGES]
Thank you Representative Floyd, quit honestly this is a rather simple
straightforward bill that has been complicated by the testimony that’s
been heard in this committee. Essentially, if I’m a developer and I put
my project out to bid, and the low bidder is a non-union shop, but I
would prefer to hire a union shop, I cannot require them to become a
union and take advantage of their pricing on this project. What this
bill does is it basically says that if I was to require the low bidder
who’s an open shop to become a member of the union in order to get the
work, then that would be unenforceable and would be void. So I
understand the testimony that’s been here, but I think the testimony’s
been off the mark. And this is very straightforward and I would urge its
passage.
[SPEAKER CHANGES]
Representative Floyd, you’re recognized.
[SPEAKER CHANGES]
How time-sensitive is this bill?
[SPEAKER CHANGES]
I’d like to go ahead and get a vote on this today. We’ve got crossover
in two weeks.
[SPEAKER CHANGES]
Follow-up Mr. Chair?
[SPEAKER CHANGES]
You’re recognized.
[SPEAKER CHANGES]
Having heard the right to work state and the union, this is the first
committee that I sit on in a long time wherein that we is not getting
what I call profound information from our staff. And when our staff does
not know the complexity of this, I think that we need to get just a
little bit more information from our staff before we make a decision of
this magnitude. Having worked in this field for about 30 years.
[SPEAKER CHANGES]
Representative Torbett.
[SPEAKER CHANGES]
Mr. Chairman, thank you. I think it’s the nature of this body to render
what we feel is the best intent and support the common good of the
citizens of North Carolina. I think it’s up to the judicial body to
determine that what we do is actually against the law or with the law.
And I would suggest that we do what we feel is inherently good. Support
this amendment and my guess is that the committee is ready for a motion.
[SPEAKER CHANGES]
Further discussion, further debate.
[SPEAKER CHANGES]
Representative Jeter, you’re recognized for a motion.
[SPEAKER CHANGES]
Rhetorically I wonder if the AFL/CIO would be howling if the DNC
mandated that all contracts go to non-union shops. With that I would
make a motion for approval or favorable report on House Bill 872.
[SPEAKER CHANGES]
And division being called, all those in favor will raise your hand.

First 33 seconds...SILENCE!
[Speaker changes.] All those opposed, raise your hand. (SILENCE til
0:54) Motion passes by a count of thirty to fifteen. Representative
Boles, you're recognized.
[Speaker changes.] To present House Bill 809, there is a proposed
committee substitute and Representative Stone makes a motion that the
PCS be properly before the committee. Representative Boles, you're
recognized to debate the bill.
[Speaker changes.] Thank you, Mister Chairman...thank the committee for
allowing me and also like to thank the staff for work that we've done on
this bill. House Bill 809 summary, as you all know is the authorized tax
exempt organizations to operate Monte Carlo Nights or game nights, in
which games of chance are played and prizes are awarded. This bill has
been asked for for non-profits, also's been by the North Carolina
Restaurant and Lodging, North Carolina Travel and Tourism and the
Charlotte Hotel Association. This particular issue came about in my
particular county, Moore County, because throughout the state, Monte
Carlo Nights for non-profits are being held and the local DA's elect not
to enforce them. In our particular county, our DA enforces this...the
gaming night provision and even informed me that if you have a local
gaming table in your own personal home and have friends that you're in
violation of the law and so that raised a lot of questions. So I worked
with staff and with the associations and I think we have a good bill
here and I don't think I need to read it to you.
[Speaker changes.] Mister Chairman?
[Speaker changes.] Further discussion/further debate? Representative
Torbett.
[Speaker changes.] Move for favorable report.
[Speaker changes.] We're gonna have a little more debate. Representative
Alexander you're recognized. Representative Moore, you're recognized.
[Speaker changes.] Very quickly, Representative Boles, how will
this...this particular piece of legislation effect the possibility of
casino-style gambling moving forward across the state? Would it have any
effect other than the provisions in this bill...or...
[Speaker changes.] No...it's not in gambling, as per se...as for fun
night. We're all here for the children and for...this is so PTA can have
fundraisers. And our non-profits. What we've tried to do is narrow it
down to qualified facilities so that, if it's misused, that the ABC
permit of that qualified facility is in jeopardy and the reputable
qualified facilities..they're not gonna put themselves in jeopardy. We
issued it in two events per month and four per year of calendar for the
tax exempt charitable organizations, which had to get a permit through
the ALE????????
[Speaker changes.] Representative Whitmire, you're recognized.
[Speaker changes.] Question for the bill's sponsor.
[Speaker changes.] You're recognized to ask the question.
[Speaker changes.] Main question on this is to prevent it from creeping
into..what so many other states have gone from a two-three million
dollar business to a hundred-two hundred billion dollar business in a
fairly short time. Can you just elaborate please on enforcement and
permitting portions so that we make sure that's not a factor here.
[Speaker changes.] OK...and I'm gonna also refer to staff also but in
the provisions, the applicant has to provide from....
[Speaker changes.]
[Speaker changes.]

to ALE. There's 9 district offices in the state. They have to prove
that they're a 503, non-profit ALE, in this provision checks with the
Secretary of State to make sure they're a qualified non-profit
charitable. At that point of time, they pay the filing fee, and then
they're issued to two, they're issued a permit to the organization, and
one particular person that has applied, so they're personally liable.
Also the qualified facility is responsible by their ABC permit. And
upon violation, I think it's in section, page 4, line 14, as far a
qualified facilities, there's a Class 2 misdemeanor, and also the
charity person who applied for the application.
[SPEAKER CHANGES]And the question I asked, essentially goes to the
purpose of money for the purpose of tax exempt organization to fund
itself, versus the purposes of the tax exempt organization, and we
assume it's tax exempt because it does have a charitable purpose. And
my disturbance with the whole bill just goes with that fact. I would be
much more comfortable with this bill if it had some requirement, and it
had at least a minimum based standard of the amount that had to go to
charitable purposes other than in some state, I understand, perhaps as
little as 4% really wound up going to charitable purposes.
[SPEAKER CHANGES]Thank you, and if you have that concern, I would share
that in Wake County you could probably do it, have your Knights, but in
Moore County you cannot, it's at the discretion of the District
Attorney.
[SPEAKER CHANGES]Representative Shepard, you're recognized.
[SPEAKER CHANGES]Yes, Mr. Chair, for a question of the bill's sponsor.
[SPEAKER CHANGES]You're recognized.
[SPEAKER CHANGES]Mr. Boles, does this also apply to like, 50-50 raffles?
[SPEAKER CHANGES]No sir.
[SPEAKER CHANGES]It does not apply to like?
[SPEAKER CHANGES]Not at all. There are, page 2, line 48, the Operation
6 specified games of entertainment, which.
[SPEAKER CHANGES]Representative Lucas, you're recognized.
[SPEAKER CHANGES]Thank you, Mr. Chair. I want to commend Representative
Boles for bringing this bill forward. It places us more in line with
reality in this state. Of what's really actually going on, and it makes
us less hypocritical as a state. You know, we talk about not allowing
any kind of gambling, but you know, practically any of church you attend
will have some kind of church bazaar, church raffle, and this kind of
thing. You will also find it very rare that you can attend a high
school football game on a Friday night that there's not a 50-50 raffle,
and I don't know what kind of accountability there is with those. And,
my travels in the rural areas, and I'm a rural person, I see all kinds
of turkey shoots, by Lions clubs, and goodwill clubs, and this kind of
thing, and I don't know what the accountability of that is but usually
there's only 1 winner in these kinds of things, and

Well, I commend Rep. Boles for being candid and honest with us, and I
think we ought to pass this bill.
[SPEAKER CHANGES] Rep. Starnes, you're recognized.
[SPEAKER CHANGES] Let me ask the sponsor a question.
[SPEAKER CHANGES] May I ask, the question, is it friendly?
[SPEAKER CHANGES] All my questions are friendly.
[SPEAKER CHANGES] Thank you. [LAUGHTER]
[SPEAKER CHANGES] Rep. Starnes, you're recognized to propound a friendly
question.
[SPEAKER CHANGES] Thank you very much. These non-profit organizations,
when they decide to have this gaming night, does it have to be held in
an establishment that currently has ABC permits, or does this give them
the right to serve the alcohol at their own location?
[SPEAKER CHANGES] No sir, they have to be at qualified facility which is
specified, Page 3, help me out here, line 21. And if I can refer to
staff just for verification of that.
[SPEAKER CHANGES] Ms. Cockran-Brown ? you're recognized.
[SPEAKER CHANGES] Thank you. the requirement that basically authorizes
this is on Page 1, beginning on line 32. On line 33 it says it's lawful
for a exempt organization to do this at a qualified facility, and that's
the only authorization that the bill provides for where this can be
located.
[SPEAKER CHANGES] Rep. Dollar, you're recognized.
[SPEAKER CHANGES] Well, just a follow-up, and this may be for the bill
sponsor or for staff. So, the gaming that would be going on would be
conducted at a commercial establishment. Is that correct?
[SPEAKER CHANGES] The definition would be, right, that has a ABC permit.
[SPEAKER CHANGES] Rep. Brawley -- ?
[SPEAKER CHANGES] In times past, it seems that they were allowed to have
game nights, and there are civic clubs in my hometown that have all
kinds of gaming equipment. We may be addressing reality. We may be
taking care of children. I'd rather my children home playing ball or
going on hayrides and things. I'm going to have to oppose the bill
because it does open up gambling, wide open, in North Carolina.
[SPEAKER CHANGES] Rep. Brody, you're recognized.
[SPEAKER CHANGES] Thank you, Mr. Chair. I'd like to ask the bill's
sponsor a question, please.
[SPEAKER CHANGES] You're recognized to propound your question.
[SPEAKER CHANGES] Rep. Boles, if I understand this correctly, no. It has
to be limited to a qualified facility, but then theoretically I guess,
if these facilities are limited in a community, it is theoretically
possible that on Monday night the Lions could have one, on Tuesday night
the Rotary Club, on Wednesday night the Catholic church. All those as
long as they, as these particular entities don't have one more than four
times a year, is that how I read it?
[SPEAKER CHANGES] No, sir. The qualified facility cannot host more than
two per calendar month, so the max would be probably 24 in year, 12
months.
[SPEAKER CHANGES] Rep. Presnell, you're recognized.
[SPEAKER CHANGES] I would ask for division on this bill.
[SPEAKER CHANGES] Division having been called, I have speakers that
would like to speak on behalf of the bill. Rev. Mark ? Creech ? from the
Christian Action League, you're recognized for a time not to exceed two
minutes. Next on deck is Bill Brooks ? from the Family Policy Council.
[SPEAKER CHANGES] Thank you, Mr. Chairman and members of the committee.
I'm Rev. Mark Creech, Executive Director of the Christian Action League.
The legislation before you today is really nothing new. It has appeared
in some form before the General Assembly since as far back as 2001.
Fortunately lawmakers have seen the wisdom in not advancing it. And with
the deepest respect for its sponsor, I hope you'll make no mistake here,
this bill is not innocuous or less dangerous because it comes as an
angel of light with the promise of helping charities. Instead, it is a
fallen angel with all the same minions of commercial gambling. This bill
in essence is a de facto form of legalized casinos across our state. It
has the potential for creating permanent stations for casino-style
gambling, for making gambling more accessible, increasing the odds for
people to become problem or pathological gamblers and with it there
comes crime, corruption and other problems invariably [CUTS OFF]

related to casino gambling. We know this in part because of states like
Michigan, Massachusetts, Illinois and Indiana. Charitable forms of
gambling have grown to be considerably problematic. We should this
proposed initiative, I suggest, for even more important reasons. We
should see that gambling in any form is predicated on the loss and pain
of others. It typically preys on the most vulnerable among us. The
principle of gambling undermines our commitment to hard work and
diligence. It capitalizes on the basest of human nature -- our greed and
the spirit of covetousness. Moreover, let me add that adding alcohol to
the mix only greases the wheels for an exacerbation of these negative
behaviors. Because gambling is fundamentally flawed, it never fulfills
its promises. And be assured that any short-term gains from charitable
casino gambling will significantly outweighed by damage in the long
term.
[SPEAKER CHANGES] Rep.? Creech ?, you've got 30 seconds to wrap up.
Thank you. Mr. Brooks ?, you're to debate the bill for a time not to
exceed two minutes.
[SPEAKER CHANGES] Thank you, Mr. Chairman. I agree with all the remarks
that Rev. Creech had, so I'll try not to repeat those. The state will
lose $1.2 million per year in revenue from the Cherokee according to the
physical note on this bill. Gambling is a predatory activity that
destroys the lives of five percent of those who participate. In addition
to their own lives, an addicted gambler will much like an alcoholic have
a negative impact on the lives of family and friends -- 17 according to
research, according to one study. Five percent of those who gamble
account for 50 percent of all the revenues. Our research indicates that
many who frequent so-called non-profit gambling venues are regulars. In
other words, they're compulsive gamblers. This bill is hiding behind the
non-profits. What legitimate non-profit makes alcohol and gambling the
centerpiece of its fundraising efforts? Marrying gambling and alcohol is
not a good idea. It increases the problems for local law enforcement.
Long history of gambling in North Carolina there is. North Carolina has
tried bingo, dog racing, horse racing, harness racing, and more recently
video poker and sweepstakes, a derivative. Casino nights will be no
different. It will morph into something bigger and worse. Legalizing
roulette wheels, craps tables and other Las Vegas-style gambling
equipment will make gambling enforcement more difficult. If a law
enforcement officer even sees the equipment, they know it's illegal.
Under this bill, it would not be. This the fifth or more session that we
have seen this type of bill. It has never been a good idea, and none
have ever been passed. Why should we legalize gambling for fun knowing
that it is going to lead to more gambling and send a signal to our
citizens that casino is an accepted enterprise? And we hope you will not
use the Cherokee as an example of why we would. That's a whole nother
debate. Simply said, they operate under a federally-approved compact
that was authorized by previous governors and previous legislatures.
It's not our intent, we're working to tighten up the bill. That's the
comment that I've heard most often from the bill sponsors and their
lobbyists when I talk to them. We haven't seen a PCS on this bill, so I
don't know what they mean by that. We recommend you vote against this
bill or vote to give it an unfavorable report. Thank you.
[SPEAKER CHANGES] Thank you, Mr. Brooks. Frank Gray ? from the North
Carolina Restaurant and Lodging Association is recognized for a time not
to exceed two minutes.
[SPEAKER CHANGES] Thank you, Mr. Chair. Members of the committee, Frank
Gray representing the North Carolina Restaurant and Lodging Association.
Our members enthusiastically endorse and support this bill. We hope you
will pass it. From the standpoint of commerce in North Carolina, this is
an important bill. I hope many of you have heard from restaurants and
hotels in your area that they are often asked by groups who want to have
meetings, conventions in their facility to have these kinds of events,
and they are good for business. They are good for the non-profit as a
fun way to raise money for the group. The bill has been carefully
crafted to put in place a permit system, have rules and regulations in
place to limit the scope, limit the number, so I would respectfully
disagree with the previous speakers about the parade of horribles that's
going to flow from this. With all due respect, it's not gambling.
There's no money at risk. [CUTS OFF]

There to make a contribution to their non-profit organization, and it’s
a fun way for the group to raise money, and it’s a good way for our
members to have business, increase their business in North Carolina. I
would say, Mr. Chair, to Doctor Fulghum’s question, on page 3, lines 9
and 10, the bill does specifically say that any proceeds from the game
night must inure to the benefit of the exempt organization. So that’s an
example of how we tried to make clear that this is a fund raising event.
It’s a fund raiser for the non-profit and we commend the bill to you.
Thank you. [SPEAKER CHANGES] Representative Stone, you’re recognized.
[SPEAKER CHANGES] Thank you Mr. Chair. I appreciate the opportunity.
First I’d like to ask if we have anyone from ALE here to give a support
up or down on their insight of the bill. [SPEAKER CHANGES] Is anybody
from the Alcohol Law Enforcement agency, would like to present or make a
comment on the legislation? Seeing none. [SPEAKER CHANGES] Well, I’d
just would like to make a few comments. [SPEAKER CHANGES] Recognized.
[SPEAKER CHANGES] This bill has been brought to us and for the most
respect all I can give my seatmate who has got the best intentions at
heart, for this bill. I know he does. And I know some of the bill
sponsors. But I’m going to speak to you on a guy that’s had multiple ALE
license, and dealt with multiple non-profits. We heard a lot of
different things in the committee today. Churches, one Representative
talked about reality. And there is a lot of reality, and there’s very
little accountability. And I’ll give you an example. If you walk into an
establishment now that has an ALE license, and they’re playing cards,
it’s against the law. The problem with this piece of legislation is
you’re going to open it up for only the attorneys will make money.
Because everyone will say that they’re a non-profit. It’s not hard to be
a non-profit. Look around. Everybody’s got a non-profit. It’s the new
way of doing business. Even if you make money, you call it a non-profit
now because it’s the only way you can stay open. I have a lot of
concerns. The restaurant and lodging, I understand why they want to
allow this legislation to move forward. It probably is good. It’s what’s
going to happen on the back streets, in the small bars, things that
could potentially open up a can of bad worms for us all. So I am
concerned. I know as I said before the intent’s great, but it does put
us between ALE and our District Attorneys. Our District Attorney’s going
to say one thing, the ALE’s going to say another. And then the other
reality is, how many ALE officers do you have? How many local [SPEAKER
CHANGES] Representative Stone, I will, let me just jump in here. I will
say that this bill does have to go to Judiciary and Finance. And so
there are a couple of bites of the apple left on this legislation, but I
think a lot of the concerns you’re raising are essentially law
enforcement, which will be handled in Judiciary. That’s the only reason
I bring that up. [SPEAKER CHANGES] Well if it’s just Commerce only, I
guess you’re trying to say the lottery’s already gambling so we’re out
of it. Thank you. [SPEAKER CHANGES] Representative Cunningham, you’re
recognized. We’d like to take a vote in about five minutes if we could.
[SPEAKER CHANGES] Thank you. My question is, it seems as though we’re
sending a mixed message. We say no to the sweepstakes, we say no to the
video, but now we want to do this gambling. How many jobs is this going
to create if it passes, that’s what I want to know. [SPEAKER CHANGES]
Representative Pierce, you’re recognized. Representative Presnell has
asked for the roll call. Representative Alexander, you’re recognized for
a motion. [SPEAKER CHANGES] My motion would be favorable for, we have a
PCS? [SPEAKER CHANGES] That’s right. [SPEAKER CHANGES] Favorable to the
PCS, unfavorable to the original. [SPEAKER CHANGES] With subsequent
referral to Judiciary and Finance. The motion having properly been made,
the clerk will call the roll. [SPEAKER CHANGES] Representative W.
Brawley. Brawley, aye. Representative Conrad. Conrad, no. Representative
Millis. Millis, no. Representative Moffitt. Representative Moffit.
Representative Moore. Moore, yes. Representative Saine. Representative
Stone. Stone, no. Representative Torbitt. Representative Alexander.
[SPEAKER CHANGES] Alexander, aye. [SPEAKER CHANGES] Alexander, aye.
Representative Avila.